New fees take center stage at council meeting

City leaders take first vote on creating utility, setting drainage fee schedule

City leaders passed a resolution that will set in motion an impact fee study and then created a “municipal draining utility,” which put into place a stormwater drainage fee schedule for homeowners and businesses across the city.

City leaders passed a resolution that will set in motion an impact fee study and then created a “municipal draining utility,” which put into place a stormwater drainage fee schedule for homeowners and businesses across the city.

At last year’s Midland City Council planning retreat, city leaders said residents could expect new fees to help pay for the needs of a growing community.

At Tuesday's meeting, city leaders backed up those words with action. City leaders passed a resolution that will set in motion an impact fee study. The council then created a utility, which when put into place will include a stormwater drainage fee schedule for homeowners and businesses across the city.

Mayor Jerry Morales said after the meeting that the goal is to help offset costs the city knows is coming because of growth in the community. City staff and leaders have identified $20 million in drainage projects that they would like to complete inside a 10-year window. The stormwater drainage fee could raise up to $2.47 million annually that would go toward those projects, according to city documents.

The fee structure for residential units is based on a building footprint. There are three rates. If a structure has less than 1,399 square feet, the rate will be $1.20 a month. Tier 2 covers properties between 1,399 and 2,424 square feet. Its rate is $2. The highest tier is for coverage greater than 2,424 square feet. Its rate is $3.40 a month.

Commercial rates are based on the building footprint, plus driveways and parking lots. There are six tiers:

- less than or equal to 8,339 square feet, $5.80 a month;

- greater than 8,339 and less than or equal to 18,702 square feet, $13 a month;

- greater than 18,702 and less than or equal to 47,853 square feet, $30 a month;

- greater than 47,853 and less than or equal to 92,740 square feet, $68.40 a month;

- greater than 92,740 and less than or equal to 261,475 square feet, $154 a month; and

- greater than 261,475 square feet, $220 a month.

If approved, the rates could go into effect as early as October, officials said during the meeting.

The creation of the utility went through a first reading Tuesday. A second reading will take place in April. In the interim, it is expected that council members will talk with city staff about adjustments that might be needed.

Morales afterward said a goal is to implement a fair system that raises money for capital improvement projects to flood-prone southeast Midland, the draws that run through Midland or the $5.3 million for projects associated with the yet-to-be-completed road bond projects.

Council members said Tuesday the $100 million approved by voters went toward construction and water/sewer, not necessarily drainage along those roads such as Thomason Drive in southwest Midland. Morales said it is important for the council to get out in the community to help explain the fees, what they will be used for in the long term (drainage projects) and how revenue from this fee system is different than revenue for other projects, including the bond.

And while the stormwater fee garnered the most attention, it wasn’t the only time Tuesday city leaders dipped their toes in the water. A $210,000 agreement with Parkhill, Smith & Cooper will put the city in position to implement more fees, including those on developers for water impact, wastewater impact and roadway impact.

These type of fees, according to city officials and repeated by the mayor afterward, are in place in just about every large city in the state and many communities across the nation. The agreement with PSC will show how fees are implemented in other communities and give city leaders a glimpse of rate schedules used elsewhere, Morales said. The study could take around nine months to complete.

Morales said city officials have already met with developers about these fees. While the fees were “not something welcomed with open arms,” they all agreed the fees are “needed.”

“If we want to help the community, which is growing aggressively, we will need these fees,” Morales said.